We Cannot Afford The Super Rich

A couple of recent events have inspired this post. On another blog that I read and occasionally contribute to, a poster was writing about Rylan Clark-Neal, a person of whom I have scant knowledge. I recall seeing a cutout of Clark-Ryan when I was in a bookshop in the UK last year. When I asked the lady behind the counter who he was, she started talking about X-Factor and I stopped listening. Apparently, Clark-Ryan finished fifth in X-Factor and he has since appeared in such delights as Celebrity Big Brother, Big Brother’s Bit on the Side, This Morning, The Xtra Factor and Up Late with Rylan and Babushka. He played the part of an air steward in Absolutely Fabulous: The Movie and has also been on BBC Celebrity Masterchef. For all this he has amassed a fortune in the region of £4.5 million!

The second event happened when shopping in my local supermarket. On the past two or three occasions I have been shopping for groceries I have been accosted by a member of staff asking if I wanted to make a donation to cancer research. Whilst nonentities like Clark-Ryan can gain huge fortunes for doing zero work, vital medical research has to be funded by turning minimum wage supermarket employees into chuggers.

There is something fundamentally wrong with the economic system in 2017.

This month’s revelations in the Paradise Papers demonstrate that the avoidance of tax and the hiding of billions of pounds worth of assets in tax havens is a widespread and  institutionalised practice for the global super rich. Everyone from Queen Elizabeth to footballer turned pundit Gary Lineker has been using legal loopholes to avoid paying their fair share of taxation on their vast and (mostly) unearned wealth. Sanctimonious, holier-than-thou hypocrite Bonio (this is not a typo – see here) has been found to be investing his massive earnings in a Lithuanian shopping centre, using a company based in Malta. This is a man who repeatedly asks for ordinary people to give their hard-earned pay to help the poor in the developing world. Bonio’s ‘compassion’ for the third world clearly does not interfere with his accumulation and stockpiling of wealth in lightly-regulated tax havens.

President John F. Kennedy supposedly remarked that “a rising tide lifts all boats” – a classic statement of the lie of trickle-down economics. Call it what you will – Monetarism, Reaganomics, Thatcherism – but the idea that taxes on the super rich must be kept low is one of the most pernicious myths of our times. The people who crashed the world’s economy in 2008 are the same people who have taken the lion’s share any increase in world growth since then. The richest 68 billionaires now have as much wealth as half the people on this planet. This is not just morally wrong but is also economically illiterate – a society of a few rich people buying luxury goods will never create the same amount of wealth as a society with a more broad spread of income. All the super rich do is waste their vast and unconscionable wealth – as I outlined in my post The $22,000 Fidget Spinner.

The ignorance of basic economics in the Western world is even more frightening than the widespread ignorance of History that I have posted about on more than one occasion. So ignorant of basic economics are some politicians that Hilary Benn, until relatively recently a senior member of the Shadow Cabinet, can deny on television that allowing immigration of 300,000 people a year has had no effect on house prices. This is not an anti-immigration point; as someone who has lived outside their country of birth for thirteen years I would be deeply hypocritical to oppose immigration. But suggesting that lots of extra people needing homes has no effect on houses prices is absurd; from dyed-in-the-wool Thatcherites to Marxist wannabes, anyone with the slightest understanding of economics accepts the laws of supply and demand – more demand for the same amount of a commodity will inevitably cause the price of said commodity to rise.

One of the more welcome results of Jeremy Corbyn’s election to the leadership of the British Labour Party has been the challenge to the neoliberal economics that has dominated UK politics since 1976. That’s right, 1976 not 1979 – the Callaghan Labour government was the first to adopted supply-side, anti-inflationary policies not the Thatcher Conservative government. But whilst a lot of people, especially voters under thirty, have been enthused by Corbyn and his Shadow Chancellor John McDonnell’s rejection of the neoliberal consensus that has dominated economic thinking for the last two generations, they have combined this with an unquestioning love of the European Union. A quick look at the destruction of the Greek economy by the EU and its pals at the IMF should show everyone that the EU is not the friend of ordinary working people. From its inception as the European Coal and Steel Community in the early 1950s, the EU has always been on the side of big business and its interests. Anyone who thinks the EU would allow the UK to remain a member and pursue Corbyn and McDonnell’s plans for large-scale nationalisation and borrowing to fund investment is living in the economic equivalent of Cloud Cuckoo Land. The EU, as it is stands, is not part of the solution but part of the problem of neoliberal economics.

The mega-wealthy have looted the riches of the world over the past couple of generations and hidden it away in offshore tax havens. The real wages of ordinary people all over the world have barely risen since the 1970s. Hundreds of millions of people continue to live in extreme poverty, without access to clean water or basic sanitation, whilst idiot celebrities get paid seven figures sums for posting pictures of their fat backsides online and reality television stars who live in luxury that would make the Emperor Caligula blush can buy their way to the presidency of the United States.

And what does the media in the UK write about economics in these circumstances? The Establishment shills at the Guardian and the so-called BBC call any opposition to the mad economics of the EU ‘racist’ whilst deluded right-wing foamers write neo-imperialist claptrap about ‘global Britain’ in disgusting rags like the Daily Mail that was out-of-date at the time of the Battle of the Somme. The media would rather discuss the toileting habits of a vanishing small section of society, imaginary thoughtcrimes like ‘Islamophobia’ or whether some bit-part actress had her backside pinched by a producer in 1984 than the systemic thievery revealed by the Paradise Papers. Most of the people who work for the media – whether they call themselves ‘conservative’ or ‘progressive’ – are doing very well out of neoliberal economics and can afford to obsess over the correct pronouns for transgender battery hens because their children are being looked after by a Lithuanian nanny on minimum wage and their house has risen in value this year by more than the annual benefits of a family of five.

As far as the specific problem of tax havens goes I have two suggestions. First, they must be no more mealy-mouthed equivocation about the difference between tax ‘avoidance’ and ‘evasion.’ Serious criminal sanctions must be applied to those guilty of concealing their wealth from the authorities. These sanctions would include imprisonment and the confiscation of 110% of the value of the money concealed. Yes, 110% of the value of the illegally concealed money – the only way to hurt the rich is to take away their money. My second suggestion is the immediate imprisonment of Bonio – preferably in a prison like the one in “Midnight Express.” This will have no discernible effect on world poverty or inequality but will make me feel a whole lot better.